I do not currently own any multi-unit income properties. Is there a good way to set up a win-win situation for multi-unit owners to sell their properties such that they do not get killed in taxes. If they have depreciated their building, then their tax due upon sale could be huge. Any ideas? Trying to think of a good way to make this situation good for both the person who wants to retire and good for the buyer.
A few years ago, a person who owned several properties approached me to see if we could work something out for me to buy his properties, but this is before I was a full-time investor and I was mainly a rehabber at the time.
As always, thanks for any ideas.
To shelter themselves from taxes (or actually to lessen a one-time bite), they can:
(1) Do a 1031 exchange
(2) Sell with owner financing
(3) Evade and go to jail
(4) Die
For you, as an investor, you can probably make a pretty strong case to owner finance to you. Then, they only pay taxes as they receive the money and continue to have the property generate an income based on the mortgae rate that you two agree on.
Keith
Keith,
Excellent. Thank you very much. I like the owner financing route.
Chip
Owner financing can be a great deal for the sellers (not to mention for the buyers!) in cases specifically like this!
Some of these folks have had a set income stream from their properties that they’ve become very accustomed to…this will allow that to continue with just about no work on their part.
Keith